In order to conduct a transaction between two peers without the need for a central authority, decentralised exchange software such as P2P crypto exchange software is developed. In order to provide customers with hassle-free and secure trading, this software performs trades using pre-programmed software and restricts access to it to just the participants in the deal.
You can build this P2P crypto exchange programme in one of two ways: from the ground up or by using existing code and rebranding it as your own. The first method involves creating the entirety of the software from scratch. Expending the necessary time, energy, and resources is costly. The second method is the immediate, efficient, and cost-effective development alternative. Therefore, a startup can take any of these routes, depending on its unique organisational makeup and requirements.
Reasons why peer-to-peer cryptocurrency trading apps are superior
P2P crypto exchange software is a more effective business model for new companies since it has more advantages that appeal to their target markets. They constitute
- Cryptocurrency assets have low transaction costs and variable pricing, regardless of market volatility. In order for a large number of people to sign up for your exchange and so increase your chances of making money.
- Your customers will have access to a 100% private network.
- You can win over users’ confidence by providing them with a safe and reliable platform for P2P trade.
- Your consumers will have a seamless trading experience thanks to the P2P software’s high latency.
- Changeable to fit the needs of any company
- Scalability allows for worldwide use.
For these reasons, startups should look at white-label P2P exchange software. So that they may profit from the many services and choices provided by the exchange by charging various fees for them. Only by incorporating advanced trading tools and security measures can you guarantee that your exchange will attract and retain users.
Here are some of the advantages of a P2P crypto exchange that have helped drive their increase in popularity.
Insensitive to the censorship of financial transactions
In a recent decision, the Central Bank of Nigeria (CBN) demanded that all cryptocurrency-related bank accounts be frozen. Banks have effectively severed relations with cryptocurrency trading platforms. That’s why it’s so hard for crypto dealers to cash out their holdings. This is the worst possible thing that can happen to a user’s money. Because trade on P2P exchanges can’t be stopped by the government, more and more Nigerians are turning to them.
As an alternative to this sort of censorship by authorities, peer-to-peer exchanges are a viable option. Why? Because a P2P exchange creates an instantaneous link between the two buyers and sellers. Payments between the parties may be made via direct bank transfer or in cash. Since P2P transactions involve no intermediary, governments can’t interfere with them.
Help for Business Deals Around the World
Regular cryptocurrency exchanges are prohibited from operating in some countries. Therefore, crypto aficionados in certain nations are unable to engage in crypto trading. However, they always have the option of using a peer-to-peer exchange, which allows for instantaneous, worldwide, efficient, and low-cost transactions.
Cheaper Financial Transactions
Custodians of assets and other third parties may be required to be compensated when dealing with centralised exchanges. Not only that, but the operations of these exchanges require human intervention. All of these factors contribute to the expense of running the market. The end user of the exchange is responsible for covering these expenses through the form of transaction fees. However, the rise of peer-to-peer (P2P) crypto exchanges has done away with the need for these middlemen, automatically pairing buyers and sellers. Thus, the expense of carrying out the transaction is kept to a bare minimum. As a result, P2P exchanges have lower transaction costs for their customers than traditional ones.
In order to make a transaction on a standard centralised exchange, a trader must deposit funds with the exchange. That leaves the safety of user cash entirely in the hands of the exchange. Unfortunately, even the most secure centralised exchanges are vulnerable to hacking attacks, sometimes resulting in the loss of users’ cash.
Instead, users’ money is not stored by P2P exchanges. This is because the exchange just acts as a connector, and traders are under no obligation to deposit funds into the account. Each trader is solely responsible for the management of their own funds. This means that users are solely responsible for protecting their money.
Innovative Functions for Business P2P Cryptocurrency Exchanges
When a cryptocurrency exchange is integrated into a company’s existing transaction processes, global expansion becomes considerably simpler for business owners. The advantages of this implementation for the future are numerous, including scalability for businesses and complete safety at all times.
Rapid expansion of existing operations
One major benefit of using a peer-to-peer cryptocurrency exchange is the ease with which a business can expand internationally. Now is a great opportunity to expand into new markets, as more and more people and businesses are adopting cryptocurrency wallets for everyday transactions. In order to scale the firm and get a competitive edge, traditional techniques sometimes require rigorous permission, but crypto exchanges don’t have this problem.
Whether your focus is on business-to-business (B2B) transactions, consumer-to-consumer (C2C) e-commerce, or the provision of services, this innovation will allow you to move closer to the cutting edge of the current market disruptions.
Using many layers of protection
As we move forward, security and data privacy will the bedrock upon which businesses must build. The increasing prevalence of digital technologies has also increased the risk of cybercrime, and only blockchain-based solutions can ensure the security of a company’s data and its clients.
Multiple layers of security protocols can protect a P2P crypto exchange development built from the ground up. Seven Bits’ blockchain developers fortify the protocol with a wide range of security measures, such as HTTPS encryption, two-factor authentication, HTTP Parameter Pollution Protection, defences against DoS and DDoS attacks, and more. Our blockchain centre of excellence (CoE) team analyses your P2P exchange, designs the most effective security measures, and implements them.
Strong Know Your Customer and Anti-Money Laundering Checks
To ensure the continued safety of their expanding operations and clientele, successful businesses must implement ever more stringent security measures. Know-your-customer (KYC) and anti-money-laundering (AML) processes can revolutionise the future of the peer-to-peer cryptocurrency exchange by eliminating fraudulent activity.
Given the complexity of the payment ecosystem, it might be difficult to integrate know-your-customer and anti-money-laundering procedures into a standard payment system. Launching a full-fledged P2P exchange that makes use of these protocols is, however, significantly more effective.
Is there any downfall to the growing popularity of peer-to-peer cryptocurrency trading platforms?
The difficulties that may encounter by a P2P exchange operator should consider before investing in P2P exchange software.
1) Extended transaction timeframes: as P2P marketplaces require time for the software to locate a vendor and a buyer. An exchange can occur only if both parties have an identical item to trade. Therefore, this model causes longer periods between trades. More traders on the platform increase the likelihood of finding the counterparty, which is the ideal solution.
2) Problems with liquidity: Traders who make a living need to make deals quickly. It may take time for P2P exchanges to become liquid, which could delay transactions. But the answer to that issue is the same as any other: bring in more dealers.